Who Will Deliver The Highest Corporate Profits and Investment Returns?
Today's highest and most sustainable corporate profits and investment returns are being delivered by leaders who embrace an enhanced stewardship of the human, environmental and capital resources they use to run their businesses.
Leaders who have embraced this initiative are already benefitting from:
Reductions in operational risks and expenses:
Acquisition of new clients, customers, consumers, investors and incremental revenue sources;
Increased corporate profits and/or investment returns;
Enhanced brand equity and value;
Improved client, customer, consumer loyalty and retention rates;
Increases in market share;
Clearer and more rapid identification of investment and product risk, and potential stranded assets;
Reductions in carbon footprints;
Increases in rankings on the “best places to work” lists such as Career Bliss and Glass Door;
Hiring the finest Millennial team members;
Decreased team turnover; and
An enhanced positive effect on Profit, People and Planet.
The world is changing and our emerging leaders, decision makers, investors, consumers, and donors, etc., will remove the optionality of enhancing the stewardship of the human, environmental and capital assets public and private ecosystems use if they desire patronage and/or support. This is being driven by:
Climate change becoming a reality in the minds of many more investors and consumers who are rightly concerned about the quality of life for the future generations of their families;
The ubiquity of information making business and investment practices more transparent providing consumers, clients and investors with the ability to make choices that mirror their values;
Generational changes as we enter the final laps of leadership based upon the values system of the Baby Boomers;
The Millennials - In the United States there are 80,000,000 Millennials (representing 4.4% of the global Millennial population). They are close to inheriting over $30 Trillion, over 60% of them (more than 48,000,000 soon to be leaders, decision makers, consumers, investors and donors) believe that corporate profit and investment returns need to be values aligned and 98% (source PWC) of them will not use their parents advisors;
Donors to endowments and foundations mandating that their donations are invested in conforming/compliant portfolios;
The world’s largest energy companies reevaluating what could prove to be significant stranded assets. This is currently (and will continue to be) driven by the advent of new technologies, the development of which have already created multiple paradigm shifts in all of our ecosystems since the early 90’s. Let's not forget that the Stone Age did not end becuase we ran out of stones;
A rapid increase in the development and support of local living economies;
The use of environmental and humanitarian screens as measures to develop risk/return metrics for investments in portfolio companies, real assets and financial instruments is expanding among investment managers;
The use of environmental and humanitarian screens as measures to determine which products or services clients, customers or consumers buy is proliferating;
Private family offices, endowments, foundations and even plan sponsors shifting their capital into what are deemed conforming or compliant investments. Almost $6 Trillion has been shifted since 2009;
Leaders of some of the world's largest corporations mandating that all products and services are procured from a fully sustainable supply chain.
The decision by a single company is resulting in 4,000 global corporations and SME's having to adopt a compliant stewardship program. Do the math if 20% of the Fortune 1000 follow suit (as many are doing); and
Emerging market countries building their emerging economies on the principles of People, Planet, Prosperity.
The most important strategic decision any executive team will make during the next five years will be whether or not to embrace the initiative of enhancing its ecosystems stewardship of the human, environmental and capital resources it uses to operate on a day to day basis.